Victorian house prices soar to new heights
January 28, 2010
The REIV December quarter Property Update has revealed a new record high median house price of $540,500 in Meblourne, an increase of 15 per cent from $470,000 in the September quarter. Major regional centres are also participating in the property market revival, with Ballarat performing the best of the larger towns.
REIV CEO Enzo Raimondo said that Melbourne’s was the largest increase in the median house price since the REIV started keeping quarterly records.
“In the December quarter of 2000 the median house price increased by 14.9 per cent and by 12.4 per cent in December quarter of 2007, compared to 15 per cent in the 2009 December quarter,” he remarked. “The combination of a better than expected economic conditions and strong population growth has resulted in an unprecedented level of pressure on housing costs in Melbourne.
“The city’s population is increasing by around 1,700 people per week and unfortunately housing construction has not responded as quickly as would be necessary to ease the pressure in the market.”
Volume is also on the rise, a sign that surging prices are based on strong demand not just weak supply.
“The level of confidence in the market is apparent from the number of homes being bought and sold; the REIV has recorded an increase of 22 per cent since the 2008 December quarter,” Mr Raimondo reported. “This is highlighted by the strong growth in the middle of the market. The largest increases in median prices have occurred for homes priced between $500,000 and $900,000.
“Burwood recorded the largest increase - 23.1 per cent - as the median increased from $658,000 to $810,000. It was followed by Ringwood, with a 16.2 per cent increase; Mount Evelyn, whose median increased by 16.1 per cent, and Brunswick, which now has a median of $724,250 after a 15.2 per cent increase.
“Prices paid for units and apartments have also increased substantially, with a 7.6 per cent increase in the median from $410,000 in the September quarter to $441,000 in this quarter.
“The suburbs with the largest increases in median price for units and apartments were East Melbourne, followed by Port Melbourne, Armadale, Caulfield North and Northcote.”
House prices increased in key centres in regional Victoria as well. The median house price in the City of Ballarat increased by 7.3 per cent to $265,000; in Greater Bendigo by 4.3 per cent to $261,000; and in Greater Geelong by 4.4 per cent to $342,000.